Moody’s warns Mining Charter will be 'credit negative' for SA resources groups
If the Mining Charter is implemented, the already low credit ratings of South African resources groups might suffer, Moody’s warned on Wednesday morning. A previous version of this article said Moody's note implied it might cut the credit ratings of South African miners. Moody's requested a clarification saying its phrase "credit negative" does not mean it intends downgrading a rating. The credit ratings agency estimated $2.5bn (about R33bn) in equity value has been wiped out of the combined $31bn (R407bn) value of the six mining groups it rates, since Minerals Resources Minister Mosebenzi Zwane unveiled the new Mining Charter last Thursday. A one notch downgrade would leave only South32 above junk status. Moody’s currently rates South32 Baa1 (equivalent to BBB+ in S&P Global Ratings and Fitch’s nomenclature) with a stable outlook.
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